November 21, 2024

Corner Office: Harman’s Chief, on How to Reduce Office Politics

Q. What were some early influences on your leadership style?

A. My father was a freedom movement advocate. He worked with Mahatma Gandhi. He spent years in jail because of his efforts to fight for India’s freedom, and he would write speeches and my mother would deliver them. Then, when he was with our family, once in a while I would attend meetings that he was hosting. He would speak up in the middle of the conversation if he heard somebody making things up or falsifying things to make themselves look good.

And I just cannot put up with injustice and political maneuvering myself. As people around me get to know me, they know I will never knowingly do anything unfair or unjust. I make mistakes, but I am also very quick to admit and correct them.

Q. Other important leadership lessons for you?

A. I have learned that leadership is all about demonstrating and exuding confidence. One of my former bosses used to say: “There will always be uncertainty in your life, doubts about yourself, about the decision you’re about to make. Keep it inside. Process it. But don’t let it show on your face. You need to come out with a confident but simple description of the problem and tell people a simple three-step process for how we’re going to get out of the problem. Because they need to know that the leader is in control.”

Q. You mentioned the importance of simplicity.

A. That same boss told his direct reports: “Whenever you’re going to talk to investors, to management, to the board, or at quarterly meetings, I want you to write it first. It may be five or six pages. Then I want you to write one page. Then I want you to write half a page.” He used to say he hated PowerPoints: “Where is the power and what’s the point?” He also would say to us, “If you cannot explain it to me without slides, you haven’t understood your problem.” That still resonates with me.

Q. What qualities are you looking for when you hire?

A. I want to know how hungry they are. Are you hungry to get to the next level? Every day you come in the office or wherever you’re traveling, you make progress. And the next day it starts from ground zero. That’s the No. 1 thing I’m looking for. Next, I’m looking for whether they will bring the best out of the teams — and not just the peer groups, but people below them and above them.

And I’m looking for people with courage. The higher up you go, courage becomes the No. 1 thing. If I don’t have courage to listen to my instincts and my colleagues’ critiques, I’m not going to make the right choices because generally the right choices are a little tough to execute.

Q. So what questions do you ask?

A. Everybody in their life has gone through the good, bad, the ugly. How did you manage the worst part? What did you learn? Then I’ll say: “If I were sitting with your boss over a beer, and I were to say, ‘I’m interviewing John for this great job and he’s fantastic. He seems to be great at this and this, but. ….’ ” Then I will ask, “What would that but be?” Some people don’t want to answer that, but some of them actually go on to tell me five “buts.” I’m looking for honesty. I’m looking for self-confidence and people who are secure in their own skin. Another thing I generally ask is, “What would your subordinates say about you?”

Once I have decided that I want to hire somebody, there’s a final step, where I’ll invite the person and their spouse to join my wife and me for dinner. It’s a social dinner.  It is an interview but it’s a not interview. And I learn things that I couldn’t learn any other way. Let’s say I’m interviewing a man. I’ll watch how he interacts with his wife. I’ll ask some of the same questions in front of his wife that I asked him before. Is he afraid to say again what he said to me? It’s amazing what you learn.

Here’s another question I’ll ask: “Tell me about a time when you had to give an assignment to your team and it didn’t go well. What was the process? What did you learn from that?” They might say they didn’t give a clear explanation of the challenge, the problem, the difficult situation. Or maybe they didn’t have the right team in place, and didn’t get enough support. But I’m listening to whether they see the big picture. If they start talking about two or three fall guys, that’s a red flag.

Q. What’s your approach to minimizing politics at your company?

A. I’ll give you a typical example. When you meet with your direct reports as a group, everybody’s contributing, and there’s good team spirit. But then you might be traveling with one of them, and he might start criticizing a new colleague in subtle ways to indirectly build himself up. That’s politics right there. When they do it I’ll say: “No, no, stop right there. He is new, he is still learning, you have to spend time with him.”

As the leader, I can either encourage politics or stop it. If you show you have no tolerance for it, and encourage people to work together, they start to figure out that Dinesh doesn’t have time for politics.

We’re a big matrix company, and there is a lot of room for politics because matrix means you might have two bosses. If there’s a problem, a conflict, I’ll often go to the source. I don’t talk over the phone. And maybe over dinner I’ll do some coaching, talk straight, give them some advice on how to work well with the other individual, and encourage them to talk to each other. I’ll tell them, “Give him a call, talk to him more, and don’t try to solve difficult issues over e-mail, because e-mails can cause serious misunderstandings or even disasters sometimes.”

When people talk, they generally sort out things. So you bring them together. I often say to people: “In our company, we don’t want any politics. If you see or smell anything like politics, kill it.” I say it constantly. That doesn’t mean we’ll be 100 percent politics-free. Politics means human, and human means politics. My hope is that the politics can be contained.

Article source: http://www.nytimes.com/2013/01/13/business/harmans-chief-on-how-to-reduce-office-politics.html?partner=rss&emc=rss

Ford and Chrysler to Follow G.M. on Pact, U.A.W. Chief Says

“This is a general framework and pattern that we will go to Ford and Chrysler with,” said the president, Bob King, at a media briefing here. “I’m confident we can put together an agreement with both.”

Negotiations at Ford and Chrysler could take several more days. Mr. King said the union had not yet decided which company to focus on first.

Earlier on Tuesday, Mr. King briefed local union officials from G.M. plants across the country on the details of the new four-year agreement reached on Sept. 16. The head of the U.A.W.’s G.M. division, Joe Ashton, said he expected the company’s 48,000 union workers to vote on the pact by next week, and expressed confidence that it would be approved.

“What we were looking for was jobs, jobs, jobs, and that’s what we came out of it with,” Mr. Ashton said.

The union estimates that G.M. will create or retain an additional 6,400 jobs over the next four years, mostly by hiring new, entry-level employees.

G.M. currently has about 1,900 second-tier workers, who are paid a starting wage of about $14 an hour. Under the new agreement, their base hourly wage will go up to nearly $16 immediately after ratification, and increase to about $19 by the end of the contract.

The entry-level workers also will get enhanced health care coverage in the new agreement.

Over all, every U.A.W. worker at G.M. will receive a $5,000 bonus for signing the contract, as well as $1,000 “inflation protection” payments in each of the last three years of the agreement.

G.M. also agreed to modifications in its profit-sharing formula for all workers.

Under the old system, payments were calculated based on profits made solely in the United States. The new contract calls for workers to get about $1,000 in profit sharing for every $1 billion that G.M. earns in its larger North American operations, which include Canada and Mexico.

Mr. King said that workers were guaranteed at least a $3,500 profit-sharing check in 2012 based on profits already earned this year by G.M.

Because it is smaller and less profitable than G.M., Chrysler is believed to be seeking an initial bonus smaller than $5,000.

The union is unable to call a strike at G.M. and Chrysler as conditions of the companies’ government bailouts. Ford, which turned around without the benefit of federal aid, does not have similar protection from a strike.

Article source: http://feeds.nytimes.com/click.phdo?i=b4c3b41aa8e1172e434bb2ba9470a948

Uncertainty Driving Treasury Bill Fluctuations

But these are not normal times.

In the last two weeks — and particularly late last week — there were moves in Treasury bill prices that indicated rising worry that the American government might not honor its obligations, or at least might not do so on time.

The worst impact was on bills that come due in August and early September. Prices of bills that mature after that suffered a little, but there seemed to be more confidence that by then the political impasse over raising the debt ceiling would have been resolved.

Of course, a month ago there was great confidence on Wall Street that a resolution would have been reached well before Tuesday, when the Obama administration said the government would otherwise run out of money.

A Treasury bill is simply a promise by the United States government that it will pay $10,000 on a particular date. Under normal circumstances, of course, a bill that matures a month from now would cost a little less than one that matures next week.

But that was not true on Friday. The $10,000 bill that matures this Thursday traded for as little as $9,970.50, a discount of $29.50. But a bill that matures Sept. 29 — eight weeks later — never traded for less than $9,991.50, a discount of $8.50.

Why would anyone pay less for a dollar to be delivered within a week than they would pay for one to be delivered nearly two months later?

The answer is certainty, or a lack thereof.

To many investors in Treasury bills, time is critical. Bills are often held because a company knows it must come up with a large amount of cash on a particular day. If you owe $10,000 this Thursday, then owning a Treasury bill maturing that day would normally mean you were completely covered.

But what if there is a day or two delay? Or a week or two? What if no one will buy it from you on the due date without a significant discount in price? If that means you cannot meet your obligations, you may face a penalty far larger than a few dollars. Do you really want to take that risk?

Some chose not to last week, and that was why prices fell.

The prices seen last week, it should be noted, did not indicate real worries about a default that continues for a substantial period of time. There is, after all, no doubt that the United States can meet its obligations if its government is willing to do so. The question is one of will.

The discounts may seem teeny, and they would be if interest rates were at normal levels. But the Federal Reserve has pushed rates down, and money the world over has flowed to Treasury bills in a flight to safety. They are normally viewed as the very definition of a risk-free investment.

In fact, there have been times when Treasury bills sold for more than face value. That would seem to make no sense, but such bills are sometimes seen as more convenient than cash.

Just two weeks ago, the $10,000 Treasury bill that matures on Aug. 11 traded for $10,000.50. On Friday, it traded for $9,973.50.

When the bills that mature on Thursday were issued in February, the discount was only $8.50, providing an annual interest rate of 0.17 percent. An investor who held that bill for 25 of the 26 weeks, and then sold late last week, ended up with a loss.

That is not supposed to happen with a risk-free investment. But until now, no one feared that Congress would refuse to allow the government to live up to its obligations.

Article source: http://feeds.nytimes.com/click.phdo?i=87200d35ac29cb3cf84720cbf81c281b